Traditional methods, such as infiltrating companies and compromising existing employees, are still widely used. Academic and educational institutions play a crucial role as well—as do the regime’s ‘front companies’ set up in the United States, estimated to number in the thousands by the FBI. Foreign companies with operations in China are said to be particularly vulnerable to losing their secrets.

Meanwhile, more advanced tools like computer hacking are becoming an increasingly important weapon in the regime’s economic-spying arsenal. ‘Their cyber activities have increased in the last ten years quite significantly,’ says Juneau-Katsuya. ‘They are devoting university departments and entire sections of the (People’s Liberation Army) just to that.’

Another key but underestimated strategy employed in China’s quest for trade secrets—corporate acquisitions and joint ventures—makes use of the regime’s vast empire of well-funded, state-owned companies. By purchasing even a significant percentage of a firm, China often obtains important technological know-how. It also buys political influence.

‘China continues to leverage foreign investments, commercial joint ventures, academic exchanges, the experience of repatriated Chinese students and researchers, and state-sponsored industrial/technical espionage to increase the level of technologies and expertise available to support military research, development, and acquisition,’ notes a 2011 US Defense Department report to Congress on Chinese military and security developments.

Especially following the recent recession, the Chinese regime has been on a global shopping spree using its vast cash reserves—buying up all sorts of companies, from car manufacturers to technology enterprises. But countless examples of the use of this tactic have been documented for well over a decade.

Even more alarming for some: A secret 1997 investigation by CSIS and the Royal Canadian Mounted Police entitled ‘Sidewinder’ found that criminal networks affiliated with Chinese intelligence were also intimately involved. The Canadian government essentially dismissed the report, but many analysts believe the collaboration has only grown since then.

In general, firms and universities are simply not doing enough to protect their secrets and technology from China, says Center for Intelligence Studies Chairman Charles Viar. ‘That said, the larger problem involves contractual agreements in which Western companies voluntarily transfer sensitive technologies—often illegally—in order to win contracts with China,’ he points out.

Fisher has similar concerns. He says firms and educational institutions around the world are not simply targets—in many cases they have become ‘compliant victims’ of Chinese intelligence agencies’ designs.

‘Companies and universities must first reach an understanding of how they are aiding and abetting the Chinese Communist dictatorship,’ says Fisher, noting that as long as they crave Chinese money, they will continue bending over backwards to satisfy the regime. ‘This scandal is compounded by the fact that Chinese allies in the capitals of most democracies are succeeding in avoiding or averting the level of critical review that would also lead to defensive action.’

Persecuting Dissidents, Even Abroad

One of the top priorities of Chinese espionage efforts—foreign and domestic—is monitoring and disrupting dissidents, according to defectors, experts, and official documents. In the crosshairs overseas are Chinese democracy activists, Tibetans, the exiled Uighur community, Falun Gong practitioners, supporters of Taiwanese independence, and countless others—essentially anybody who disagrees with the regime or paints a negative image of it abroad.

In 2009, for example, a massive and sophisticated cyber espionage network was discovered by Canadian researchers. The system, known as ‘GhostNet,’ had reportedly penetrated computers belonging to multiple governments, the exiled Dalai Lama, and a number of other dissidents and critics. Investigators traced the operation to China.

Last year, after a ‘highly sophisticated and targeted attack’ originating in China, Google announced that a primary goal of the operation was to gain access to Chinese human rights activists’ e-mail accounts. ‘Dozens’ of such accounts had already been compromised through other means before the attack in question, the company also said in a statement.

It’s not just human rights campaigners and pro-Tibetan activists who are under constant attack, however. Among the most viciously persecuted are individuals associated with Falun Gong, also known as Falun Dafa. The spiritual and philosophical movement was banned by the Communist regime in 1999 after officialdom decided it might represent a threat to the Communist Party.

Labelling it an ‘evil cult,’ China then created an extra-legal apparatus known as the 6-10 Office to quash the discipline domestically—and around the world. An unprecedented campaign of terror and brainwashing has since been unleashed, including a vast network of ‘re-education’ camps, disappearances, torture, harvesting organs from practitioners, and more.

And the regime’s tentacles have truly spread worldwide in pursuit of its goal. ‘The war against Falun Gong is one of the main tasks of the Chinese mission overseas,’ Chen Yonglin, a senior official at the Chinese Consulate in Sydney told a US Congressional committee in 2005 after his defection.

A vast body of evidence, and even recent court cases, support the claim. In June, for example, a Chinese man in Germany was convicted of spying on members of the Falun Gong community for China. A few years earlier, a senior Chinese embassy official in Ottawa was expelled after being caught spying on practitioners there.

In the United States, officials also regularly highlight the problem. The House of Representatives has blasted the regime for similar illegal activities inside the United States on at least four occasions. A House resolution passed last year and a separate measure adopted in 2004, for instance, recognized the seriousness of the problem, called for the regime to stop, and urged US authorities to take action.

According to the resolutions, China’s diplomatic corps is actively ‘harassing and persecuting’ Chinese dissidents in the United States, breaking into the homes of prominent activists, pressuring US officials with threats, spreading lies, and more. In addition to the well-known persecution going on within China, ‘the Chinese Government has also attempted to silence the Falun Gong movement and Chinese pro-democracy groups inside the United States,’ the measures state.

More than a few US Representatives have been even more direct. Foreign Affairs Committee Chair Ileana Ros-Lehtinen (R-FL), speaking in support of the resolution, said last year that ‘clear evidence’ shows Chinese diplomats were colluding with secret agents and ‘thugs’ to suppress the constitutionally protected rights of Americans. She called on the State Department to ‘get tough’ on the regime’s functionaries within US borders.

‘First is the issue of the penetration of agents of an alien Communist regime right here inside the United States to wage a campaign of repression against US citizens,’ Ros-Lehtinen said before the House, citing examples and noting that Chinese agents were ‘persecuting American Falun Gong practitioners in our own country.’ And the well-documented ‘bloody harvest’ and ‘coercive organ transplants’ from Falun Gong practitioners within China, she added, ‘is almost too ghoulish to imagine.’